Banks that offer student loans

College is expensive. Although the federal government provides student loans to help people pay through college, sometimes that isn't enough. When this happens, students can rely on private lenders to cover the rest of their expenses. While some private lenders offer less than favorable terms, many national banks offer student loans with low interest rates and customized terms, making them a good place to start when looking for private loans for education.

Best banks for student loans

It is always a good idea to shop around and compare loan offers from several lenders before applying. The list below can help you narrow down your list of options.

Citizen Bank

Best for: Students who need help over the years.

Citizens Bank only has branches in 14 states but offers private student loans nationwide. The bank offers loans to undergraduate and graduate students as well as parents who hope to help their children attend school. Loan periods for students ranging from five to fifteen years, and for parents from five to ten years.

The lender has both variable and fixed interest rates and offers a loyalty discount of 0.25 percent to existing customers—including your co-signer if you have them—a checking account, savings account, money market account, certificate of deposit, auto loan, home equity loan or line of credit for a purchase. A home, mortgage, credit card account, or other student loan owned by Citizens Bank. The bank also offers a 0.25 percent discount on the interest rate for automatic payments.

Citizens Bank also offers the opportunity to obtain multi-year approval. With this feature, you have to make a rigorous inquiry once for several years of student loan needs. When you request payments in the future, you'll have to go through a soft credit check, which saves you the hassle of applying every year.

Discovery

Best for: Students who don't have a co-location

Discover is an online bank with only one physical branch. The bank offers a variety of private student loans, including college loans, graduate loans, MBA loans, health professions loans, legal loans, residence loans, bar exam loans, and parental loans. The loan term is 15 years for undergraduate loans and 20 years for graduate loans.

The lender offers both variable and fixed interest rates with the opportunity to get discounts on your rate, including a 0.25 percent discount if you set up automatic payments from a checking or savings account.

Discover offers cash rewards for good scores to sweeten the pot even more. If you have a GPA of 3.0 or higher for the period covered by the loan, you can take 1 percent of the loan balance disbursed. And if you're an incoming freshman, you can get a 1 percent cash bonus on your first loan from the bank if you had a GPA of 3.0 or higher in high school.

Education loan financing

Best for: Students with good credit

Education Loan Financing, or ELFI, is the online student loan division of Southeast Bank, located in Tennessee. The lender provides loans to undergraduate and graduate students, as well as parents. Students' repayment lengths range from five to fifteen years, while parents' repayment terms range from five to ten years.

What sets ELFI apart from other lenders is that you will be assigned a student loan advisor who will assist you throughout the process. However, unlike other banks, ELFI does not provide auto-pay savings, claiming that you do not need to do anything extra to enjoy their best rates.

PNC Bank

Best for: Health and medical students

PNC Bank, situated in Pennsylvania, provides undergraduate and graduate students with private student loans. It also provides special loans for the health and medical professions, the establishment of health professions, and the study of lawyers.

The lender provides fixed as well as variable interest rates. PNC, like several other banks, gives an interest rate reduction, although it is double the typical discount at 0.5 percent. Private student loans from PNC Bank have repayment terms ranging from five to 15 years.

PNC is unique in that they provide $2,000 scholarships twice a year, and you don't even have to have PNC student loans to be eligible. Once entered and meet the eligibility requirements, you will be eligible for two draws in the next 12 months.

Sallie Mae

Best for: Covering the full cost of education

Sallie Mae is another online bank that has no physical branches. The bank offers undergraduate student loans, postgraduate loans, and apprenticeship loans.

Graduate loan options are divided into MBA Loans, Medical School Loans, Medical Residency Loans, Dental School Loans, Dental Residency Loans, Health Professions Loans, Law School Loans, and Bar Study Loans. The repayment lengths range from ten to twenty years.

The bank offers both fixed and variable interest rates, with the chance of a 0.25 percent discount if you set up automatic payments. Sallie Mae can be a great option for part-time students because, unlike most student loan companies, it doesn't require you to be in school at least half the time to be approved.

Do banks give student loans without a co-signer?

It can be difficult for college students to get approved for a private student loan without a co-signer, especially if you have very little income and credit history.

Banks are no different in this sense than other lenders, so if you want to apply for a private student loan, consider having a parent sign the loan application so that you will be approved and eligible. Chances of qualifying for interest rates can be improved.

Also, if you have a credit history to your name, you may be able to find a bank that will accept your loan application without a co-signer. This is especially true of top school loans.

Student loans from banks vs online lenders

In general, banks that offer student loans are relatively similar to online lenders. Although each bank has its own unique characteristics, there is not much difference between these two types of lenders.

However, some of the best banks for student loans offer loyalty discounts to their existing customers. This can be useful if you or your co-signer has a qualifying account with a bank that offers private student loans. A bank can also be a good option if you prefer personal customer support and have a branch near you.

Before applying for any loan, take the time to walk around and compare interest rates, repayment terms, and other features with several lenders to ensure you get the best deal for you.

How to apply for a student loan from a bank

The process for applying for private student loans with a bank is not much different than it is with other lenders. Here's what to expect:

Shop around: Even if your bank offers a loyalty discount, compare rates from several online banks, credit unions, and lenders to determine which one gives you the best deal. In addition to pricing, you'll also want to compare payment plans, co-location version options, forbearance and deferment plans, and other important features.

Apply directly with the lender: Once you've decided on which bank to apply to, you can usually apply directly through the bank's website. Some may also allow you to apply by phone or in person, but applying online is the faster option. You will usually need to provide information about yourself, your school, the amount you want to borrow and other relevant details.

Submit Documentation: The bank may request documentation of your income, government-issued ID and other relevant information about your application. The faster you share your documents, the faster the underwriting process.

Final Offer Acceptance: Once the lender has fully reviewed your credit history and other aspects of your application, you will receive a final offer similar to the one you received when you first requested a quote. It might or might not be available. If you agree to the terms, read the loan agreement and other documents provided by the lender and sign them electronically.

Wait for Payment: Private student loans are often paid off initially at your school to pay tuition, fees, and other associated costs. If money is owed, you should receive it directly. At this point, you can use your loan money for other eligible education expenses.

Also, make sure you know when the payments will begin. If you are a student, you can usually wait until after you leave school to start making your payments. But if you are a parent taking out a loan to help your child with school, the repayments can start right away. If any queries, please get in touch with your lender.

Bottom Line

If you need private loans to help cover the cost of college, consider shopping around national banks and other major lenders to see what interest rates they offer. Many offer reasonable payment terms and can cover a small or large portion of your educational expenses. Find the best lender for your requirements.